The demand curve faced by a perfectly competitive industry
A. slopes downward.
B. is horizontal.
C. slopes upward.
D. has no slope.
Answer: A
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Use the following graph, which shows the supply and demand curves for dollars in the pound/dollar market, to answer the next question.
Assume that D1 and S1 are the initial demand for and supply of dollars. Suppose that Britain's demand for dollars increases from D1 to D2. If the British government wishes to fix the exchange rate at the initial level, then it would be faced with a problem of ________.
A. rationing Q2 dollars among British importers who would like to acquire Q3 dollars B. rationing Q3 dollars among British importers who would like to acquire Q2 dollars C. deteriorating terms of trade D. a rise in the pound price of dollars
According to Joseph Schumpeter, the theory of creative destruction describes a process by which
A) some new products unleash a gale of destruction that drive other new products out of the market. B) the creation of new products never involves the destruction of old products. C) new products unleash a gale of destruction that drives old products out of the market. D) new products are created by the destruction of capital.
As the dollar depreciates, the dollar price of imported goods _________, ultimately shifting the United States AD curve __________________
A) rises; rightward B) rises; leftward C) falls; rightward D) falls; leftward
Because of automatic stabilizers, when GDP fluctuates the...
What will be an ideal response?